Inflation to stay within Reserve Bank’s target band

Consumer price inflation is expected to stay within the South African Reserve bank’s 3 to 6% target band, while retail sales are expected remain subdued as consumers grapple with the rising cost of living.

But she warns that Nersa’s decision to approve additional electricity tariffs hikes will result in higher inflationary pressures.

ETM Analytics economist, Jana Van Deventer says CPI is expected to rise on the back of rising fuel prices.

Van Deventer outlined that retail sales growth is under pressure due to the high unemployment. She has also explained that the consumer’s disposable income has been eroded by higher transport and electricity tariff costs.

The retail sector is likely to struggle for the next 6 to 8 month. She says this because consumers are under pressure and do not have significant buying power.

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